Nashua OKs payment to developer Stabile for river work

By KIMBERLY HOUGHTONUnion Leader CorrespondentApril 30. 2014 10:59PMNASHUA — Controversy over a local developer's $100,000 bill for river embankment work drew significant debate by aldermen on Wednesday. As part of the Cotton Mill Square project, developer John Stabile worked last summer to install a crest gate at the Jackson Mills Dam, which allowed the floodplain to be lowered and the $24 million housing project to be constructed.

During work on the $2.4 million dam upgrades — paid for by the Stabile Company and various federal grants — it was discovered the Nashua River embankment on the right side of the dam was not as wide as it should be.

Since the city owns the dam, Mayor Donnalee Lozeau suggested previously that escrow funds be used to pay the $100,000 expense to correct the abutment problems. That request was approved last fall.

Although the aldermanic Budget Review Committee ultimately approved reimbursing the $100,000 Wednesday, two aldermen voiced opposition. Ward 9's Ken Siegel argued that the entire dam project should be completed before city officials discuss the merits of whether to pay the requested $100,000 for abutment work. Noting that significant tax credits have already been issued for the Cotton Mill Square project, Siegel said the true cost of the abutment work is not actually known.

The contract between the city and Stabile stated that the city had no obligation to pay for any of the dam repairs, according to Siegel.

Mayor Donnalee Lozeau said the city owns the dam, and the unexpected abutment problems discovered during the Stabile project could not be ignored. Lozeau said city officials agreed in good faith to use escrow funds to pay for only the abutment fix, not any of the other dam work.

"I think it is the right thing to do," Lozeau said. "... I think we have an obligation to uphold that."

Alderman David Schoneman, Ward 3, said he considers the abutment work part of the overall dam project, which the city was not obligated to pay.

In addition, Schoneman said the previous escrow approval was not a payment, but rather a potential expenditure.

"I don't see how I can support it," Schoneman said of the $100,000 reimbursement.

Others argued that the city is ultimately responsible for the improvement costs incurred by Stabile during the dam renovations.

"It is a separate issue from the crest gate," said Alderman-at-Large Brian McCarthy, adding city officials should honor the agreement, or other developers may think twice about partnering with the city on various projects.

Alderman Richard Dowd, Ward 2, agreed. If the retaining wall had collapsed, it would have cost the city significantly more than $100,000, he said.